Reportable  IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.8151 OF 2009 (Arising out of SLP [C] No.15031 of 2006]

Union of India & Ors. … Appellants

Vs.

M. K. Sarkar … Respondent

J U D G M E N T

R.V.RAVEENDRAN,J.

Leave granted.

2. The respondent joined the Railway service on 10.2.1947. He was a  

subscriber to Contributory Provident Fund Scheme. Railways introduced  

the pension scheme vide Railway Board’s letter dated 16.11.1957. Under  

the  said  scheme,  those  who  entered  Railway  service  on  or  after  

16.11.1957, were automatically governed by the pension scheme. Those  

employees who were  in  service  as  on 1.4.1957 and those  who joined  

between 1.4.1957 and 16.11.1957 were given an option to switch over to  

pension scheme instead of continuing under the Contributory Provident

Fund Scheme.  Those who did not opt for the pension scheme were given  

further  opportunities  to exercise  options to switch over to the pension  

scheme,  whenever  the  pension  scheme was  liberalised  or  made  more  

beneficial,  vide  Notifications  dated  17.9.1960,  26.10.1962,  17.1.1964,  

3.3.1966, 13.9.1968, 15.7.1972, and 23.7.1974. The validity period of the  

Eighth  Option  under  Notification  dated  23.7.1974,  which  was  from  

1.1.1973 to 22.1.1975, was extended from time to time upto 31.12.1978.  

Under the terms of the option, a retired railway employee who opted for  

the pension scheme had to refund to the government’s contributions to  

the provident fund.  

3. The respondent though aware of the introduction of  the pension  

scheme and the options given on eight occasions between the years 1957  

to 1974, consciously did not opt for the pension scheme and continued  

with the Contributory Provident Fund Scheme. Ultimately the respondent  

while  serving  as  Controller  of  Stores,  took  voluntary  retirement  with  

effect  from 15.10.1976.   As  on  the  date  of  his  retirement,  the  eighth  

option to shift to pension scheme, was still  open for exercise. But the  

respondent  did  not  opt  for  the  pension  scheme,  but  received  the  

Contributory Provident Fund dues, on his retirement.

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4. More  than  22 years  after  his  retirement,  and after  receiving his  

dues  under  the  Provident  Fund  Scheme,  the  respondent  made  a  

representation dated 8.10.1998, requesting that he may be extended the  

benefit of the pension scheme. He stated that he was willing to refund the  

amount  received  under  the  Provident  Fund  Scheme  (by  way  of  

adjustment against the arrears of pension that would become payable to  

him on acceptance of his request for switch over to the pension scheme).  

The said request was not accepted. The respondent therefore approached  

the Central Administrative Tribunal, in OA No.657 of 1999, seeking a  

direction  to  the  Railway  Administration  to  permit  him to  exercise  an  

option to switch over to pension scheme. The Tribunal by order dated  

11.2.2004 disposed of the application by directing the appellants to take a  

decision  on  the  representation  of  the  respondent  by  a  reasoned  order,  

making it clear that it did not examine the claim on merits.  In compliance  

with  the  said  direction  of  the  Tribunal,  the  chairman,  Railway Board,  

considered  the  representation  and  passed  a  reasoned  order  dated  

15.5.2004, rejecting the belated request of the respondent for switching  

over to the pension scheme as being untenable.  He also distinguished the  

cases  of  other  employees  who were  allegedly  extended the benefit  of  

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exercising the option for belated switch overs, cited and relied upon by  

the respondent. The relevant portion of the order is extracted below:  

“Thus, the cases referred to in the preceding para are not relevant to  the case of Shri Sarkar who had eight occasions to come over to the  Pension Scheme during his service period. By the time, VIII Pension  option  was  thrown  open,  vide  Board’s  letter  dated  23.7.1974  as  extended  from time to  time  upto  31.12.1978,  Shri  Sarkar  was  in  service  till  15.10.1976.  He  resumed  as  COS/NF  Railway  on  11.6.1976. Board’s instructions dated 30.6.1976 extending the last  date  for  exercising  of  option available  under  Board’s  letter  dated  23.7.1974 to come over to the pension scheme upto 31.12.1976 was  circulated by NF Railway vide their letter dated 17.7.1976. The said  letter  was circulated as per standard mailing list  including HODs.  Shri Sarkar, being the HOD himself at the relevant time, cannot deny  having knowledge of the aforesaid Railway Board’s instructions.  

5. The respondent challenged the order dated 15.5.2004 by filing a  

second application before the Tribunal. The following averments in the  

application made by the respondent are relevant:  

“…  those  employees  appointed  earlier  (to  1.4.1957),  however  continued  to  be  on  PF  system,  but  were  periodically  given  the  opportunity to opt for pension, on inspection of merits of the scheme  as and when new pension scheme was offered. ….. The applicant  retired  in  1976  and  that  in  the  meantime  periodically  for  certain  range of time, the employees were asked to submit options………. A  considerable number of employees  including the applicant did not  submit option as the then scheme for pension introduced for the said  limited  period  was  not  considered  beneficial,  since  upto  VII  amended option, the scheme would hardly give any benefit  to the  said employees including the applicant. Later on, however, came the  VIII  option,  through  which  a  break  through  order  vide  railway  Board’s letter No. PC II (75) PB/3 dated 23.7.1974 was issued on the  acceptance of the recommendation of the 3rd Pay Commission. The  validity of the order although initially for six months was extended  from time to time till 31.12.1978. It was, inter alia, laid down in the  

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said order that in the case of those Railway Servants who are eligible  for  exercising  option  under  this  order  but  who  have  retired  and  settled  up  under  the  SRPF  (contributory)  Rules,  the  option  for  pension  will  be  valid  if  they  refund  the  entire  government  contribution.  The Railway administration  was  accordingly to  take  urgent steps to bring the contents of the said letter to the notice of all  concerned  employees  under  their  administrative  control  including  those on leave or on deputation etc. It was also laid down that to  facilitate circulation of this order, the Board desired that the contents  of the order should be published by the Railway in their Gazette in  an extra-ordinary issue as well suitable press releases also be issued.

The  applicant  states  that  he  was  on  deputation  from June  1972 to 8th January, 1975. Moreover on July 28, 1974 the applicant  suffered an acute heart attack almost coinciding with the date of the  issue of this order. Thereafter he was hospitalised for post Cardiac  convalescence and accordingly was on leave for a long period. He  was  not  even  intimated  about  the  content  of  the  order  by  the  respondents through any communication during his deputation…… ……………..The  applicant  also  states  that  after  retirement  in  October,  1976 the applicant was cut off from railway and was in  darkness about their Pension policy. In 1998 the applicant came to  know  that  some  officers  of  administrative  grades  were  given  pensionary benefit with or without intervention of court since they  had not been informed about option for pension.”           

The Tribunal  by order dated 25.7.2005 allowed the application of the  

respondent and directed the appellants to permit the respondent to opt for  

pension  scheme  and  also  inform the  respondent  the  amount  that  was  

required to be refunded in case he exercised the option.  The Tribunal  

extracted the reasons assigned by the Chairman of the Railway Board in  

his  order  dated  15.5.2004  rejecting  the  request  of  respondent.  

Significantly,  the  Tribunal  did  not  disagree  with  the  said  finding,  nor  

refer to the enormous delay in making the claim. The Tribunal allowed  

the application, as the Railways had remained unrepresented and had not  

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contested the claim, even though in the entire application there was no  

averment denying knowledge of the availability of the VIII Option dated  

23.7.1974.

6. The appellants challenged the order of the Tribunal in WP (CT)  

No.467/2005. The High Court dismissed the writ petition by order dated  

25.1.2006. The said order of the High Court is challenged in this appeal  

by special leave. The question for consideration is whether the respondent  

was entitled to exercise an option to switch over pension scheme, beyond  

the stipulated last  date,  that too twenty two years after retirement  and  

receipt  of  the  retirement  dues  under  the  Contributory  Provident  Fund  

Scheme.                    

7. When a  scheme extending the  benefit  of  option  for  switchover,  

stipulates that the benefit will be available only to those who exercise the  

option within a specified time, the option should obviously be exercised  

within such time. The option scheme made it clear that no option could  

be exercised after the last date. In this case, the respondent chose not to  

exercise  the  option  and  continued  to  remain  under  the  Contributory  

Provident  Fund  Scheme,  and  more  important,  received  the  entire  PF  

amount on his retirement. The fact that the respondent was the head of his  

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department and all communications relating to the offer of Eighth Option  

and  the   several  communications  extending  the  validity  period  for  

exercising the option for pension scheme, were sent to the heads of the  

departments  for  being  circulated  to  all  eligible  employees/retired  

employees, is not in dispute. Therefore, the respondent who himself was  

the head of his department could not feign ignorance of the Eighth Option  

or the extensions of the validity period of the Eighth Option. In fact, as  

noticed above, in his application before the Tribunal the respondent refers  

to all the options. He is careful to say that he was not ‘intimated’ about  

the contents of the last order relating to extension of the option, but does  

not say that he was unaware of the order extending the benefit of option.  

The  respondent  consciously  chose  not  to  exercise  the  option  as  he  

admittedly thought  that  receiving a  substantial  amount in  a  lump sum  

under the provident fund scheme (which enabled creation of a corpus for  

investment)  was  more  advantageous  than  receiving  small  amounts  as  

monthly pension under the pension scheme. In those days (between 1957  

when the pension scheme was introduced and 1976 when the respondent  

retired) the benefits under the provident fund scheme and pension scheme  

were  more  or  less  equal;  and  there  was  a  general  impression  among  

employees that having regard to average life expectancy and avenues for  

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investment of the lump sum PF amount, it was prudent to receive a large  

PF amount on retirement rather than receive a small pension for a few  

years (particularly as there was a ceiling on the pension and as dearness  

allowance was not included in the pay for computing the pension).  

8.  From 1980 onwards, gradually the pension scheme became more  

and more attractive as compared to the Contributory Provident Scheme,  

on account of various factors, like dearness allowance being included in  

the pay for computing pension, ceiling on pension being removed and  

liberalisation of family pension etc. But the respondent was well aware  

that  not having opted for pension scheme and having received the PF  

amount on retirement, he was not entitled to seek switch over to pension  

scheme. But in 1996, when the respondent learnt that some others who  

had retired in and around 1973 to 1976 had been permitted to exercise the  

option in 1993-94 on the ground that they had not been notified about the  

option, he decided to take a chance and gave a representation seeking an  

option to switch over to pension scheme. Having enjoyed the benefits and  

income from the  provident  fund  amount  for  more  than  22  years,  the  

respondent could not seek switch over to pension scheme which would  

result  in  respondent  getting  in  addition  to  the  PF  amount  already  

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received, a large amount as arrears of pension for 22 years (which will be  

much more than the provident fund amount that will have to be refunded  

in the event of switch over) and also monthly pension for the rest of his  

life.  If  his request  for such belated exercise of option is  accepted,  the  

effect would be to permit the respondent to secure the double benefit of  

both provident fund scheme as also pension scheme, which is unjust and  

impermissible. The validity period of the option to switch over to pension  

scheme expired on 31.12.1978 and there was no recurring or continuing  

cause of action. The respondent's representation dated 8.10.1998 seeking  

an option to shift to pension scheme with effect from 1976 ought to have  

been straight away rejected as barred by limitation/delay and laches.

9. The  order  of  the  Tribunal  allowing  the  first  application  of  

respondent  without  examining  the  merits,  and  directing  appellants  to  

consider his representation has given rise to unnecessary litigation and  

avoidable  complications.  The  ill-effects  of  such  directions  have  been  

considered by this Court in C. Jacob vs. Director of Geology and Mining  

& Anr. – 2009 (10) SCC 115 :  

“The courts/tribunals proceed on the assumption, that every citizen  deserves a reply to his representation. Secondly they assume that a  mere direction to consider and dispose of the representation does not  involve any ‘decision’ on rights and obligations of parties. Little do  

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they realize the consequences of such a direction to ‘consider’. If the  representation is  considered and accepted,  the ex-employee  gets a  relief, which he would not have got on account of the long delay, all  by  reason  of  the  direction  to  ‘consider’.  If  the  representation  is  considered and rejected,  the  ex-employee  files  an  application/writ  petition, not with reference to the original cause of action of 1982,  but by treating the rejection of the representation given in 2000, as  the cause of action. A prayer is made for quashing the rejection of  representation  and  for  grant  of  the  relief  claimed  in  the  representation.  The Tribunals/High Courts  routinely entertain such  applications/petitions  ignoring  the  huge  delay  preceding  the  representation, and proceed to examine the claim on merits and grant  relief.  In  this  manner,  the  bar  of  limitation  or  the  laches  gets  obliterated or ignored.”  

When  a  belated  representation  in  regard  to  a  ‘stale’  or  ‘dead’  

issue/dispute is considered and decided, in compliance with a direction by  

the  Court/Tribunal  to  do  so,  the  date  of  such  decision  can  not  be  

considered as furnishing a fresh cause of action for reviving the ‘dead’  

issue or time-barred dispute.  The issue of limitation or delay and laches  

should be considered with reference to the original cause of action and  

not with reference to the date on which an order is passed in compliance  

with  a  court’s  direction.  Neither  a  court’s  direction  to  consider  a  

representation issued without examining the merits, nor a decision given  

in compliance with such direction, will extend the limitation, or erase the  

delay and laches. A Court or Tribunal, before directing ‘consideration’ of  

a  claim  or  representation  should  examine  whether  the  claim  or  

representation  is  with reference to  a ‘live’  issue or  whether  it  is  with  

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reference to a ‘dead’ or ‘stale’ issue.  If it is with reference to a ‘dead’ or  

‘state’ issue or dispute, the court/Tribunal should put an end to the matter  

and should  not  direct  consideration or  reconsideration.  If  the  court  or  

Tribunal deciding to direct 'consideration' without itself examining of the  

merits,  it  should make it  clear that such consideration will  be without  

prejudice  to  any contention  relating  to  limitation  or  delay  and laches.  

Even  if  the  court  does  not  expressly  say  so,  that  would  be  the  legal  

position and effect.  

10. Even on merits, the application has to fail. In Krishena Kumar vs.   

Union of India – 1990 (4) SCC 207, a Constitution Bench of this Court  

considering  the  options  given  to  the  Railway  employees  to  shift  to  

pension scheme, held that prescription of cut off dates while giving each  

option was not arbitrary or lacking in nexus. This Court also held that  

provident fund retirees who failed to exercise option within the time were  

not entitled to be included in the pension scheme on any ground of parity.  

Therefore,  the respondent who did not exercise the option available when  

he retired in 1976, was not entitled to seek an opportunity to exercise  

option to  shift  to  the  pension scheme,  after  the  expiry  of  the  validity  

period for option scheme, that too in the year 1998 after 22 years.  

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11. The respondent relied on the decision of a two-Judge Bench of this  

Court in Union of India vs. D.R.R. Sastri – 1997 (1) SCC 514 in support  

of his claim. The said decision is clearly distinguishable on facts. In that  

case,  the  respondent,  a  railway  employee,  had  gone  on  deputation  to  

Heavy Engineering Corporation, and later resigned from railway service  

with effect from 26.6.1973 and was absorbed in the service of the said  

Corporation. When the Liberalised Pension Scheme was introduced by  

the Railway Board by letter dated 23.7.1974, an opportunity was given to  

all persons governed by the Provident Fund Scheme who were in service  

of Railways as on 1.1.1973 to opt for the pension scheme. The Railway  

Board directed that the availability of such option should be brought to  

the  notice  of  all  retired  railway  servants  who  were  in  service  as  on  

1.1.1973, The respondent therein who had left  the Railway service on  

26.6.1973 was not informed of the availability of the option. He could not  

therefore exercise the option. In fact, he retired from service of the Heavy  

Engineering  Corporation  without  any  pension  as  that  Corporation  had  

also no pension scheme. The respondent therein approached the Central  

Administrative Tribunal in 1993 alleging that he came to know about the  

said option only in 1993 and that his representation dated 12.6.1993 for  

relief was rejected by the Railway Board on 13.7.1993. The Tribunal held  

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that the respondent should be given the opportunity to exercise his option  

to shift to pension scheme, in terms of the Railway Board’s letter dated  

23.7.1974, as he was prevented from exercising his option by the failure  

of Railways to inform him about the option. The Tribunal also took note  

of the fact  that another railway employee was allowed to exercise the  

option long after the date for exercising the option had expired, but the  

respondent  was  not  given  a  similar  benefit.  The  said  decision  of  the  

Tribunal was affirmed by this Court. The decision in D.R.R. Sastri is of  

no assistance as it does not lay down any proposition that the last date  

prescribed for exercising option is not relevant or that option could be  

exercised at any time, even if a last date had been stipulated for exercise  

of the option. That case was decided on its peculiar facts as the employee  

(who was on deputation and who resigned from the service of railways on  

26.6.1973 when on deputation)  was  not  made  aware  of  the  option  to  

which he was entitled, even though there was a specific instruction that  

all employees who had retired after 1.1.1973 should be informed about  

the  option.  The  facts  of  this  case  are  completely  different.  Here  the  

employee was in service of the Railways itself before and at the time of  

retirement.  He  was  working  as  the  Head  of  the  Department  and  was  

receiving all communications relating to option for being circulated to all  

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employees in his department. Therefore, the question of respondent not  

being aware of the option does not arise.  

12. The Tribunal in this case has assumed that being ‘aware’ of the  

scheme was not sufficient notice to a retiree to exercise the option and  

individual written communication was mandatory. The Tribunal was of  

the view that as the Railways remained unrepresented and failed to prove  

by positive evidence, that respondent was informed of the availability of  

the option, it should be assumed that there was non-compliance with the  

requirements relating to notice. The High Court has impliedly accepted  

and affirmed this view. The assumption is not sound. The Tribunal was  

examining the issue with reference to a case where there was a delay of  

22 years. A person, who is aware of the availability of option, cannot  

contend that he was not served a written notice of the availability of the  

option after 22 years. In such a case, even if Railway administration was  

represented, it was not reasonable to expect the department to maintain  

the records of such intimation/s of individual notice to each employee  

after 22 years. In fact by the time the matter was considered more than  

nearly 27 years had elapsed. Further when notice or knowledge of the  

availability of the option was clearly inferable, the employee cannot after  

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a long time (in this case 22 years) be heard to contend that in the absence  

of  written  intimation of  the  option,  he  is  still  entitled  to  exercise  the  

option.  This  Court  considered  the  meaning  of  ‘notice’  in  Nilkantha  

Sidramappa  Ningashetti  v.  Kashinath  Somanna  Ningashetti  etc.  [AIR  

1962 SC 666]. This Court held :  

“We see no ground to construe the expression ‘date of service of  notice’ in col. 3 of Art. 158 of the Limitation Act to mean only a  notice in writing served in a formal manner. When the Legislature  used the word ‘notice’ it must be presumed to have borne in mind  that it means not only a formal intimation but also an informal one.  Similarly, it must be deemed to have in mind the fact that service of  a  notice  would  include  constructive  or  informal  notice.  If  its  intention were to exclude the latter sense of the words ‘notice’ and  ‘service’ it would have said so explicitly.”      

13. Learned counsel for the respondent lastly submitted that one K.V.  

Kasturi who had retired in 1973, was granted the benefit of exercising the  

option by an order dated 19.9.1994, and therefore, principles of equality  

and equal  opportunity  required that  the  Railways  should give him the  

option. The Chairman of Railway Board, while rejecting the respondents’  

representation by order dated 15.5.2004 has clarified that K.V. Kasturi’s  

case  was  similar  to  that  of  D.R.R.  Shastri as  he  had  also  not  been  

informed of the availability of option. There is another angle to the issue.  

If someone has been wrongly extended a benefit, that cannot be cited as a  

precedent for claiming similar benefit by others. This court in a series of  

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decisions has held that guarantee of equality before law under Article 14  

is a positive concept and cannot be enforced in a negative manner; and  

that  if  any  illegality  or  irregularity  is  committed  in  favour  of  any  

individual or group of individuals, others cannot invoke the jurisdiction  

on  courts  for  perpetuating  the  same  irregularity  or  illegality  in  their  

favour  also,  on  the  reasoning that  they  have  been denied  the  benefits  

which  have  been  illegaly  extended  to  others.  See  :  Chandigarh  

Administration vs. Jagdish Singh – 1995 (1) SCC 745;  Gursharan Singh  

& Ors. vs. New Delhi Municipal Committee & Ors. – 1996 (2) SCC 459;  

Faridabad  C.T.  Scan  Centre  vs.  Director  General,  Health  Services  –  

1997 (7)  SCC 752; State of Haryana vs. Ram Kumar Mann – 1997 (3)  

SCC 321, State of Bihar & Ors. vs. Kameshwar Prasad Singh & Anr. –  

2000 (9) SCC 94 and Union of India vs. International Trading Company  

– 2003 (5) SCC 437. A claim on the basis of guarantee of equality, by  

reference  to  someone  similarly  placed,  is  permissible  only  when  the  

person similarly placed has been lawfully granted a relief and the person  

claiming relief is also lawfully entitled for the same. On the other hand,  

where a benefit was illegally or irregularly extended to someone else, a  

person who is not extended a similar illegal benefit  cannot approach a  

court  for  extension  of  a  similar  illegal  benefit.  If  such  a  request  is  

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accepted, it would amount to perpetuating the irregularity. When a person  

is refused a benefit to which he is not entitled, he cannot approach the  

court and claim that benefit on the ground that someone else has been  

illegally extended such benefit. If he wants, he can challenge the benefit  

illegally granted to others. The fact that someone who may be not entitled  

to the relief has been given relief illegally is not a ground to grant relief to  

a person who is not entitled to the relief.  

14. The appeal is therefore allowed and the orders of the Tribunal and  

the High Court are set aside and the original application of the respondent  

before the tribunal is dismissed.

………………………..J. (R V Raveendran)

New Delhi; ……………………….J. December 8, 2009. (K S Radhakrishnan)       

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